The return on equity isn’t very good for those properties. NC and SC have some great markets for short term rentals and you would definitely increase your wealth by splitting the money and buying multiple properties. I self manage 2 properties out of state and can help you if needed. Also, if you need a mortgage broker.. I know a guy
Why sell if its a future retirement that will offer equity/cash flow. Instead I would pull the cash out to buy the home in NC. I would look at a cash out refinance instead of a Heloc for a few reasons but the main reason is a Heloc is a burden on the property since its in 2nd lien position. That means you can never take cash out again unless you pay it off. You can also get a lower rate on a 30 year fixed and even though its a 30 year loan there is No prepayment penalty so you can pay as much as you want but not obligated to pay more.
A Heloc is a credit risk and can "never" be used as an asset or PITI reserve which is required when buying additional properties. Mortgage rates are much better versus Helocs due to Heloc being a shorter term and carry higher rates.
You should need much you can buy a primary home for 5% down, Vacation home for 10% and investment for 15% and keep in mind if you have PMI the rate will always be lower. A lot of people put more down but end up with a higher rate. PMI offers a lower rate because the private insurance offers assurance with less risk.
I'm new to this whole thing and came across cash-out refinancing. It sounds like a good option, especially since my bank offers it. My brother, who owns a business, actually recommended keeping the house and to use HELOC for the second home. He was able to buy two houses using a HELOC because his business has strong cash flow and he can repay the loan quickly.
Anyway, after reading your post, I'm leaning towards refinancing my house. Would you recommend any YouTube channels, books, or podcasts to learn more about cash-out refinancing and similar options? Thanks for your reply
Honestly, you should run the numbers on both. That is a lot of equity in the home, and not a lot of cashflow if I am reading that correctly. Give a loan officer a call and work through your options that way. What is your timeline for moving?
I would guess just based off of the info given that your best bet for wealth building is to go low down payment in NC in a great area (Im down here, if you have any questions shoot me a dm) and hold the NJ property. The name of the game is to get the max amount of appreciation, on the most assets possible.
Considering the hefty property taxes in my current area, totaling around $9,000 annually, I'm contemplating selling and reinvesting in two properties within the Charlotte area. This strategic move holds promise for generating positive cash flow, which could effectively alleviate the future monthly deficit if I refinance my house.
If my statement is not correct, please let me know.
The return on equity isn’t very good for those properties. NC and SC have some great markets for short term rentals and you would definitely increase your wealth by splitting the money and buying multiple properties. I self manage 2 properties out of state and can help you if needed. Also, if you need a mortgage broker.. I know a guy
I work with a ton of developers and investors in Bergen County and could get you an offer on your property if you're planning on selling it. Save you the hassle of listing it and paying out a bunch of realtor commissions. We mainly deal with off market properties. Let me know, thanks.